Monday, December 30, 2013

How Facebook gets rich leveraging personas

(Editor's note: In this guest essay, Mark Weinstein, founder and CEO of Sgrouples.com, a privacy-centric social network, breaks down Facebook's profit model.)

On October 30th, Facebook held its third quarter earnings call. Lost inside the upbeat state of the union was a recurring theme that active and inactive Facebook users need to take note of: Facebook is knowingly placing your information at risk and needs to do more of it in order to survive.

A few years back Facebook founder Mark Zuckerberg announced that privacy was dead. That declaration expectedly ruffled a lot of feathers, causing Zuckerberg to step back and makeover his message. What emerged was a positive spin of the same sentiment, one that helped him reframe the equation. Instead of having to defend the company against accusations concerning privacy, safety, and data mining abuses, Facebook would focus on helping us all "understand the world."

This simple three-word statement has become one of the core components of Facebook's current investor messaging along with similar ideas of "connecting everyone" and "helping to build the knowledge economy."

Tantalizing investors and users alike however with optimistic promises to build "the clearest model of everything there is to know in the world" is one thing. Delivering on it is entirely another. While the sentiment rings deeply philosophical, it sadly ends up rather shallow.

What Zuckerberg wants is a world where Facebook can use your information, without limitations, to figure out everything there is to know about you to target marketing for Facebook's gain. Sound farfetched? Guess again.

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This year Facebook introduced Graph Search, which makes every piece of Facebook content shared by or with you accessible through natural language queries. Then last quarter came Posts Search, which lets you search all unstructured text and posts that peop! le have ever made on Facebook. Then just last month Facebook formed a new artificial intelligence (AI) group.

Straight from the pages of a Ray Bradbury novel comes a secretive department whose goal is to hone "all of the knowledge that people have shared on Facebook…to help make sense of all the content that people share so we can generate new insights about the world to answer people's questions."

What does this AI group really mean? Artificial intelligence has the potential to help Facebook recognize emotions behind texts and analyze photos. Based on this level of understanding, Facebook could then predict the likely future behavior of each of us.

With the recent acquisition of Mobile Technologies, Facebook intends to use AI to also delve into speech recognition and machine translation as well to further figure out how to use who you are to its advantage. All of these technology advances make for fascinating conversation, but do little to help the user. For Facebook though, these tools simplify the path to growing ad revenue. By knowing you Facebook can best help its advertisers sell to you.

When did signing up with a social network become a vehicle for signing away your identity? Should any group within any company have the right to break down every aspect of your five senses for profitable gain? How far do we allow any business to push the safety envelope in the name of revenue?

When I started Sgrouples, I did so with the intent of combining social media with personal privacy. As a conscious capitalist, I believe that social media presents a profitable opportunity that can and should put the user experience at the forefront of the medium and that can and should better society by enabling us to communicate more closely with one another. Underneath my intentions lies a common theme of user safety, one which I fail to see in Facebook's model. We should all get to enjoy the wonderful benefits and pleasures that social media affords us, but under an umbrella of safety that! visibly ! protects us and gives us the peace of mind we want when online and interacting in our everyday lives.

About the essayist: Mark Weinstein, is the author of the Habitually Great book series, and a Huffington Post privacy blogger. He is the founder and CEO of Sgrouples.com, a privacy-centric social network that, he says, is positioned to lead the privacy revolution.

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